The term ‘credit rating’ has received an enormous amount of attention in recent years. The difficulties experienced by our biggest banks have led to a tightening of lending criteria, so the need to have a consistent record of repaying your debts is more important than ever.
Your credit rating is vital to your aspirations of getting on in life. It dictates your chances of obtaining the mortgage you need for a new home. If you want to buy a new car with finance, your credit rating will be checked before your application is approved, with the current status of your credit rating often dictating how expensive your credit will be. By obtaining a copy from Experian CreditExpert before you apply for credit, you can ensure any problems that could harm your chances of approval are dealt with beforehand.
What can affect your credit rating?
Lenders compile a score on you, based on the level of risk you pose as a borrower. If you have a history of managing debt levels sensibly and keeping up with your repayments, the likelihood is that your credit rating will be relatively favourable, increasing your chances of getting the affordable finance you need for the big purchases in life. If your rating is low, however, you may encounter problems when trying to secure affordable loans and credit facilities. A low credit rating can also hinder your chances of securing certain jobs, including those in banks and the financial sector.
Why should you check your credit rating regularly?
Most people don’t check their credit status regularly enough, and because it can change on an almost daily basis, this can leave you open to nasty surprises during a credit application process. You may not realise it, but an inaccurate record of a late credit card payment two years ago could be scuppering your chances of buying a home. Issues such as this one could also drive up the cost of borrowing, so it’s important to do all you can to improve your credit rating.
If you check your credit status on a regular basis, you can flag any concerns or errors before they impact your ability to buy a house or secure finance for a new car. Some of the information held on your credit file may be out of date, or simply incorrect. You can apply to have certain information removed from record, which could prevent an embarrassing and frustrating rejection during an application process.
Scrutinising your credit history regularly will also help to detect instances of identity fraud. Someone could be running up thousands of pounds worth of debt in your name without your knowledge. Unfortunately for some, the first time this issue is identified is when a credit application is refused. Your credit rating has a direct influence on many areas of your financial health. From buying a new home to securing the job you want, it is often the difference between joy and disappointment. By keeping a close eye on your own credit history, you can identify issues before they have a chance to interfere with your plans for the future.